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The accounting records of J.L. Home Store show these data in millions The shareholders are very happy with J.L.’s steady increase in net income

The accounting records of J.L. Home Store show these data (in millions). The shareholders are very happy with J.L.’s steady increase in net income. Auditors discovered that the ending inventory for 2010 was understated by $4 million and that the ending inventory for 2011 was also understated by $4 million. The ending inventory at December 31, 2012, was correct.  Requirements 1. Show corrected income statements for each of the three years. 2. How much did these assumed corrections add to or take away from J.L.’s total net income over the three-year period? How did the corrections affect the trend of net income? 3. Will J.L.’s shareholders still be happy with the company’s trend of net income? Give the reason for youranswer.

Apr 12 2020 View more View Less

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